Exhibit (e)
UNDERWRITING AGREEMENT
THIS AGREEMENT is made as of September 30, 2002, by and between The
HomeState Group (the "Fund"), and Citco-Quaker Fund Distributors, Inc., a
Delaware corporation ("Underwriter").
WHEREAS, the Fund is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Fund is authorized by its Declaration of Trust and by-laws
to issue separate Portfolios of shares representing interests in separate
investment portfolios (the "Portfolios"), and
WHEREAS, The Fund has authorized the issuance of shares of beneficial
interest ("Shares") in the Portfolios which are identified on Exhibit A attached
hereto, which Exhibit A may be amended from time to time by mutual agreement of
the Fund and Underwriter, and;
WHEREAS, Underwriter is a broker-dealer registered with the Securities
and Exchange Commission and a member in good standing of the National
Association of Securities Dealers, Inc., (the "NASD"); and
NOW, THEREFORE, in consideration of the promises and agreements of the
parties contained herein, the parties hereto, intending to be legally bound,
agree as follows:
1. APPOINTMENT. The Fund hereby appoints Underwriter as exclusive agent
for the distribution of Shares of the Portfolios listed in Exhibit A
hereto, and Underwriter hereby accepts such appointment under the terms
of this Agreement.
Notwithstanding any other provision hereof, the Fund may terminate,
suspend or withdraw the offering of Shares of any Portfolio whenever,
in its sole discretion, it deems such action to be desirable.
2. SALE AND REPURCHASE OF SHARES.
(a) Underwriter, as agent for the Fund, will sell Shares to the
public against orders therefor at the public offering price,
all such sales to comply with the provisions of the 1940 Act
and the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.
(b) Underwriter will also have the right to take, as agent for the
Fund, all actions, which, in Underwriter's judgment, are
reasonably necessary and proper to carry into effect the
distribution of the Shares.
(c) The net asset value of the Shares of each Portfolio (or Class
of Shares of a Portfolio) shall be determined in the manner
provided in the Fund's then current Registration Statement,
and when determined shall be applicable to transactions as
provided for in the Registration Statement. The net asset
value of the Shares of each Portfolio (or each Class of Shares
of a Portfolio) shall be calculated by the Fund or by another
entity on behalf of the Fund. Underwriter shall have no duty
to inquire into nor shall it have any liability for the
accuracy of the net asset value per share as calculated.
On every sale of Shares, the Fund shall receive the applicable
net asset value of the Shares promptly, but in no event later
than the third business day following the date on which
Underwriter shall have received an order for the purchase of
the Shares.
(d) Upon receipt of purchase instructions, Underwriter will
transmit such instructions to the Fund or its transfer agent
for registration of the Shares purchased.
(e) Nothing in this Agreement shall prevent Underwriter or any
affiliated person (as defined in the 0000 Xxx) of Underwriter
from acting as underwriter or distributor for any other
person, firm or corporation (including other investment
companies) or in any way limit or restrict Underwriter or any
such affiliated person from buying, selling or trading any
securities for its or their own account or for the accounts of
others for whom it or they may be acting; provided, however,
that Underwriter expressly represents that it will undertake
no activities which, in its judgment, will adversely affect
the performance of its obligations to the Fund under this
Agreement.
(f) Underwriter, as agent of the Fund and for the account of the
Portfolio(s), may repurchase the Shares at such prices and
upon such terms and conditions as shall be specified in the
Fund's then current Registration Statement. At the end of each
business day, the Underwriter shall notify the Fund and the
Fund's transfer agent of the number of Shares redeemed for
each Portfolio, and the identity of the shareholders or
dealers offering Shares for repurchase. Upon such notice and
acceptance by the Fund, the Fund shall pay the Underwriter the
net asset value of the redeemed shares in cash or in the form
of a credit against monies due the Fund from the Underwriter
as proceeds from the sale of Shares. The Fund reserves the
right to suspend such repurchase right upon written notice to
the Underwriter. The Underwriter further agrees to act as
agent for the Fund to receive and transmit promptly to the
Fund's transfer agent, shareholder and dealer requests for
redemption of Shares in the Porfolio(s).
3. SALES OF SHARES BY THE FUND. The Fund reserves the right to issue or
sell Shares of the Portfolio(s) directly to the public at any time.
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4. BASIS OF SALE OF SHARES. Underwriter does not agree to sell any
specific number of Shares. Underwriter, as agent for the Fund,
undertakes to sell Shares of the Portfolio(s) on a best effort basis
only against orders therefor.
5. COMPLIANCE WITH NASD AND GOVERNMENT RULES.
(a) Underwriter will conform to the Rules of Fair Practice of the
NASD and the securities laws of any jurisdiction in which it
sells Shares of the Portfolio(s).
(b) The Fund agrees to furnish to the Underwriter sufficient
copies of any agreements, plans or other materials it intends
to use in connection with sales of Shares in adequate time for
the Underwriter to file and clear them with the proper
authorities before they are put in use, and not to use them
until so filed and cleared.
(c) Underwriter, at its own expense, will qualify as dealer,
broker, or otherwise, under all applicable State or federal
laws in order that Shares may be sold in such States as may be
mutually agreed upon by the parties, except for expenses
described in Section 7 hereto, which will be paid by the Fund
or the Adviser to the Fund, as appropriate.
(d) Underwriter shall not make, in connection with any sale or
solicitation of a sale of the Shares, any representations
concerning the Shares except those contained in the Fund's
then current prospectus and statement of additional
information covering the Shares and in printed information
approved by the Fund as information supplemental to such
prospectus and statement of additional information. Copies of
the Fund's then effective prospectus and statement of
additional information and any such printed supplemental
information will be supplied to Underwriter in reasonable
quantities upon request.
6. RECORDS TO BE SUPPLIED BY FUND. The Fund shall furnish to Underwriter
copies of all information, financial statements and other papers which
Underwriter may reasonably request for use in connection with the
distribution of Shares of the Portfolio(s).
7. EXPENSES TO BE BORNE BY FUND. The Fund will bear the following
expenses:
(a) preparation, setting in type, and printing of sufficient
copies of the prospectus and statement of additional
information for distribution to shareholders, and the
distribution to shareholders of the prospectus and statement
of additional information;
(b) preparation, printing and distribution of reports and other
communications to shareholders;
(c) registration of the Shares under the federal securities law;
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(d) qualification of the Shares for sale in the jurisdictions
designated by Fund and Underwriter;
(e) maintaining facilities for the issue and transfer of the
Shares;
(f) supplying information, prices and other data to be furnished
by the Fund under this Agreement; and
(g) any original issue taxes or transfer taxes applicable to the
sale or delivery of the Shares of certificates therefor.
8. INDEMNIFICATION.
(a) The Fund agrees to indemnify, defend and hold the Underwriter,
its officers, and Trustees, and any person who controls the
Underwriter within the meaning of Section 15 of the Securities
Act of 1933 (the "1933 Act") or Section 20 of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), free and
harmless from and against any and all claims, demands or
liabilities and expenses (including the cost of investigating
or defending such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which the
Underwriter, its officers, Trustees or any such controlling
persons may incur under the 1933 Act, the 1934 Act, or under
common law or otherwise, arising out of or based upon any
untrue statement of a material fact contained in the Fund's
Registration Statement or Prospectus or arising out of or
based upon any alleged omission to state a material fact
required to be stated in either thereof or necessary to make
the statements in either thereof not misleading, except
insofar as such claims, demands, liabilities or expenses arise
out of or are based upon any such untrue statement or omission
or alleged untrue statement or omission made in reliance upon
and in conformity with information furnished in writing by the
Underwriter to the Fund for use in the Registration Statement.
The Underwriter agrees to comply with all of the applicable
terms and provisions of the 0000 Xxx.
(b) The Underwriter agrees to indemnify, defend, and hold the
Fund, its officers, Trustees, employees shareholders and
agents, and any person who controls the Fund within the
meaning of Section 15 of the 1933 Act of Section 20 of the
1934 Act, free and harmless from and against any and all
claims, demands, liabilities and expenses (including the cost
of investigating or defending against such claims, demands or
liabilities and any counsel fees incurred in connection
therewith) which the Fund, its Trustees, officers, employees,
shareholders and agents, or any such controlling person may
incur under the 1933 Act, the 1934 Act or under common law or
otherwise arising out of or based upon any untrue statement of
a material fact contained in information furnished in writing
by the Underwriter to the Fund for use in the Registration
Statement, or arising out of or based upon any omission or
alleged omission to state a material fact in connection with
such
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information required to be stated in the Registration
Statement necessary to make such information not misleading.
(c) A party seeking indemnification hereunder (the Indemnitee)
shall give prompt written notice to the party from whom
indemnification is sought ("Indemnitor") of a written
assertion or claim of any threatened or pending legal
proceeding which may be subject to indemnity under this
Section; provided, however, that failure to notify the
Indemnitor of such written assertion or claim shall not
relieve the indemnitor of any liability arising from this
Section. The Indemnitor shall be entitled, if it so elects, to
assume the defense of any suit brought to enforce a claim
subject to this Agreement and such defense shall be conducted
by counsel chosen by the Indemnitor and satisfactory to the
Indemnitee; provided, however, that if the defendants include
both the Indemnitee and the Indemnitor, and the Indemnitee
shall have reasonably concluded that there may be one or more
legal defenses available to it which are different from or
additional to those available to the Indemnitor ("conflict of
interest"), the Indemnitor shall have the right to select
separate counsel to defend such claim on behalf of the
Indemnitee. In the event that the Indemnitor elects to assume
the defense of any suit pursuant to the preceding sentence and
retains counsel satisfactory to the Indemnitee, the Indemnitee
shall bear the fees and expenses of additional counsel
retained by it except for reasonable investigation costs which
shall be borne by the Indemnitor. If the Indemnitor (i) does
not elect to assume the defense of a claim, (ii) elects to
assume the defense of a claim but chooses counsel that is not
satisfactory to the Indemnitee or (iii) has no right to assume
the defense of a claim because of a conflict of interest, the
Indemnitor shall advance or reimburse the Indemnitee, at the
election of the Indemnitee, reasonable fees and disbursements
of any counsel retained by Indemnitee, including reasonable
investigation costs.
9. ADVANCES OF EXPENSES. The Fund shall advance attorney's fees or other
expenses incurred by a Covered Person in defending a proceeding only to
the extent permitted by 1933 Act and the 1940 Act.
10. TERMINATION AND AMENDMENT OF THIS AGREEMENT. This Agreement shall
automatically terminate, without the payment of any penalty, in the
event of its assignment. This Agreement may be amended only if such
amendment is approved (i) by Underwriter, (ii) either by action of the
Board of Trustees of the Fund or at a meeting of the Shareholders of
the Fund by the affirmative vote of a majority of the outstanding
Shares, and (iii) by a majority of the Trustees of the Fund who are not
interested persons of the Fund or of Underwriter, by vote cast in
person at a meeting called for the purpose of voting on such approval.
Either the Fund or Underwriter may terminate this Agreement at any time
on sixty (60) days' written notice delivered or mailed by registered
mail, postage prepaid, to the other party.
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11. EFFECTIVE PERIOD OF THIS AGREEMENT. Unless terminated automatically as
set forth in Section 10 of this Agreement, this Agreement shall take
effect upon its execution and shall remain in full force and effect for
a period of TWO years from that date, and shall remain in full force
and effect from year to year thereafter, subject to annual approval (i)
by Underwriter, (ii) by the Board of Trustees of the Fund or by vote of
a majority of the outstanding Shares, and in either case (iii) by a
majority of the Trustees of the Fund who are not interested persons of
the Fund or of Underwriter, by vote cast in person at a meeting called
for the purpose of voting on such approval.
12. LIMITATION OF FUND'S LIABILITY. The Term "Funds" means and refers to
the trustees and officers from time to time serving under the Fund's
Declaration of Trust and by-laws as the same may subsequently thereto
have been, or subsequently hereto be, amended. It is expressly agreed
that the obligations of the Fund hereunder shall not be binding upon
any of the Trustees, Shareholders, nominees, officers, agents or
employees of the Fund personally, but bind only the property of the
Fund, as provided in Fund's Declaration of Trust and by-laws. The
execution and delivery of this Agreement have been authorized by the
Trustees of the Fund and signed by the officers of the Fund, acting as
such, and neither such authorization by such Trustees, nor such
execution and delivery by such officers shall be deemed to have been
made by any of them individually or to impose any liability on them
personally, but shall bind only the property of the Fund as provided in
its Declaration of Trust.
13. SUCCESSOR INVESTMENT COMPANY. Unless this Agreement has been terminated
in accordance with Paragraph 10, the terms and provisions of this
Agreement shall become automatically applicable to any investment
company which is a successor to the Fund as a result of a
reorganization, recapitalization or change of domicile.
14. SEVERABILITY. In the event any provision of this Agreement is
determined to be void or unenforceable, such determination shall not
affect the remainder of this Agreement, which shall remain in full
force and effect.
15. QUESTIONS OF INTERPRETATION.
(a) This Agreement shall be governed by the laws of the State of
Pennsylvania.
(b) Any question of interpretation of any term or provision of
this Agreement having a counterpart in or otherwise derived
from a term or provision of the 1940 Act shall be resolved by
reference to such term or provision of the 1940 Act and its
interpretation thereof, if any, by the United States courts;
or in the absence of any controlling decision of any such
court, by rules, regulations or orders of the Securities and
Exchange Commission issued pursuant to said Act. In addition,
where the effect of a requirement of the 1940 Act, reflected
in any provision of this Agreement is revised by rule,
regulation or order of the Securities and Exchange Commission,
such provision shall be deemed to incorporate the effect of
such rule, regulation or order.
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16. NOTICES. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at
such address as such other party may designate for the receipt of such
notice. Until further notice to the other party, it is agreed that for
this purpose the address of the Fund is 0000 Xxxxxx Xxxx, X.X. Xxx
00000, Xxxxxxxxx, XX 00000-0000, Attn: Xx. Xxxxx Xxxx, and of the
Underwriter shall be 0000 Xxxxxx Xxxxx Xxxx, Xxxxx 00, Xxxxxx Xxxxx, XX
00000, Attn: Xx. Xxxxx X. Xxxxx.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
18. BINDING EFFECT. Each of the undersigned expressly warrants and
represents that he has the full power and authority to sign this
Agreement on behalf of the party indicated, and that his signature will
operate to bind the party indicated to the foregoing terms.
19. FORCE MAJEURE. If Underwriter shall be delayed in the performance of
its services or prevented entirely or in part from performing services
due to acts of God, interruption of power or other utility,
transportation or communication services, acts of civil or military
authority, sabotages, national emergencies, explosion, flood, accident,
earthquake or other catastrophe, fire, strike or other labor problems,
legal action, present or future law, governmental order, rule or
regulation, or shortages of suitable parts, materials, labor or
transportation, such delay or non-performance shall be excused for a
reasonable time, subject to restrictions and requirements of
performance as may be established by federal or state law.
20. COMPENSATION. The Fund shall pay for the services to be provided by
Underwriter under this Agreement in accordance with, and in the manner
set forth in, Schedule B attached hereto, as such Schedule B may be
amended from time to time by agreement of the parties.
If this Agreement becomes effective subsequent to the first day of a
month or terminates before the last day of a month, Underwriter's
compensation for that part of the month in which this Agreement is in
effect shall be prorated in a manner consistent with the calculation of
the fees as set forth above. Payment of Underwriter's compensation for
the preceding month shall be made promptly.
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IN WITNESS WHEREOF, the Fund and Underwriter have each caused this
Agreement to be signed on its behalf, all as of the day and year first above
written.
ATTEST: THE HOMESTATE GROUP
____________________ By: _________________________
Name: Xxxxx Xxxx
Title: President
ATTEST CITCO-QUAKER FUND DISTRIBUTORS, INC.
____________________ By: _______________________
Name: Xxxxx Xxxxx
Title: President
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UNDERWRITING AGREEMENT
EXHIBIT A
The following Portfolios and share classes thereof are hereby made
subject to the underwriting Agreement dated _________, 2002, with Citco-Quaker
Fund Distributors, Inc. ("Underwriter") and The HomeState Group (the "Fund"),
and each agree to be bound by all the terms and conditions contained in said
Agreement:
PORTFOLIOS CLASS A CLASS B CLASS C
The Emerald Growth Fund X X
The Emerald Select Banking & Finance Fund X X
The Emerald Select Technology Fund X X
UNDERWRITING AGREEMENT
EXHIBIT B
The following fees are hereby made subject to the underwriting
Agreement dated _________, 2002, with Citco-Quaker Fund Distributors, Inc.
("Underwriter") and The HomeState Group (the "Fund"), and each agree to be bound
by all the terms and conditions contained in said Agreement:
Underwriter will charge a flat fee of $12,000 per year for underwriting services
provided for Portfolios of the Fund that offer No-Load Shares only.
Underwriter will receive the underwriting concessions set forth in the Fund's
current prospectus and/or statement of additional information as full
compensation for underwriting services provided for Portfolios of the Fund that
offer Share Classes that charge sales loads.
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